Problem:
Many of the small "dot-com" companies got financing in the form of an instrument called convertible debt. This is like ordinary debt, in that it pays a regular interest amount. But debt-holders have the right to convert it to equity. Why do you think these companies chose this instrument? Do you think it was a good idea?
Remember: there's no 'free lunch'. If a company offers creditors an option to convert the bond into stocks it must be giving them something of value. It should get something in return.
(You may of course browse for 'convertible debentures' on the web.)